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Virginia, Illinois, Ohio and Indiana have the most to gain in jobs and new investment if PJM, the nation’s largest grid operator, can solve some of the problems that are now leading to long delays in clean energy projects, a new report said.
For that to happen, PJM would have to approve projects at the same pace as about a decade ago.
But there are two major hurdles to overcome. The grid operator should make major progress on about 3,000 active cases in its new service request queue, with 97 percent of the more than 250 gigawatts of proposed new generation being for renewable energy, battery storage or a combination of the two. And PJM, whose territory spans from Chicago to New Jersey, should add enough interstate powerline capacity to connect those projects to the grid.
The June 28 report from the American Council on Renewable Energy (ACORE), a trade group, focuses on about 2,000 projects totaling 167 gigawatts of proposed onshore clean energy generation, which PJM must process as it implements reforms that are approved by federal regulatory authorities in November. Those reforms include a shift to prioritizing projects most ready to be built and a “fast lane” for smaller projects.
ACORE report author Noah Strand and other contributors acknowledge that not all of those projects will ultimately be approved and built. So the report assumes a completion rate of 20.3 percent, which is similar to that for 2011 to 2016. It then makes estimates for job creation, investment and other benefits for the resulting 34 gigawatts of clean energy.
With more than 43,000 megawatts of proposed capacity in the PJM queue pending approval, Virginia will reap about a quarter of the $33 billion in capital investment and 198,716 labor years that those projects, totaling 34 gigawatts, could generate, the report estimated. .
A job year represents one job for one year. Because the biggest job demands of any project come during the construction phase, that’s a fair way to estimate job creation, said Brendan Casey, who contributed to the report and is deputy director of economic analysis for the American Clean Power Association.
A good rule of thumb for estimating permanent employment is to divide the total number of years of employment by three or four, he said.
Illinois, Ohio, and Indiana rank second, third, and fourth in potential benefits for proposed projects. Each state will gain between $4.7 billion and $5.5 billion in capital investment and approximately 29,000 to 32,000 labor years, while other states in the network footprint gain smaller amounts of investment and jobs.
Additional grid-wide benefits include an estimated reduction in wholesale electricity costs of more than $16 per megawatt-hour from 2021 levels, due to an increase in renewable energy on the grid and incentives from the Inflation Reduction Act, the report said. , citing a December 2022 Analysis by researchers at Princeton University. Displaced coal production could also provide significant public health benefits, worth about $44 per megawatt-hour, the report said.